Should I Wait for Mortgage Rates To Come Down Before I Move?

If you're thinking about making a move, you might be wondering if you should wait until mortgage rates fall before selling. Here's some information that may help answer your question.

In the housing market, mortgage rates and buyer demand have a long history of correlation. Typically, higher rates result in lower buyer demand. That's because some people who want to relocate will be hesitant to take on a higher mortgage rate for their new home. So they decide to wait it out and postpone their plans.

Things change, however, as interest rates fall. It progresses from limited or weak to good or strong demand. That's because many of the buyers who sat on the sidelines when interest rates were higher will return and make their purchases. The graph below provides a visual representation of how this relationship works and where we are today.

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Lisa Sturtevant, Chief Economist at Bright MLS, explains:

“The higher rates we’re seeing now [are likely] going to lead more prospective buyers to sit out the market and wait for rates to come down.”

Why You May Not Want to Wait

If you're wondering, "What does this mean for my move?" Here is the golden nugget. According to experts, mortgage rates are still expected to fall this year, albeit slightly later than previously anticipated.

As interest rates fall, more people will return to the market. That means you'll face a lot more competition from other buyers when looking to buy your next home. If you wait, your move may become more stressful because increased demand may result in more offer scenarios and faster price increases.

However, if you're ready and able to sell right away, it might be worthwhile to get ahead of the game. You have the opportunity to move before the competition increases.

Bottom line.

If you're debating whether to wait for interest rates to fall before making a move, keep buyer demand in mind. Once rates fall, competition will increase even more. If you want to get ahead of the curve and sell now, let's talk.

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